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A California backlash rises over foreign IT worker replacements

Patrick Thibodeau | July 2, 2015
California lawmakers have taken steps to attack the use of foreign labor to replace U.S. workers. One effort seeks to use the state's regulatory powers to prohibit utilities from shifting jobs overseas.

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California lawmakers have taken steps to attack the use of foreign labor to replace U.S. workers. One effort seeks to use the state's regulatory powers to prohibit utilities from shifting jobs overseas. Another legislative attack calls on federal agencies to investigate the H-1B program.

Both measures were approved this month by the California State Assembly.

This legislative interest stems from the decision by Southern California Edison (SCE) to lay off IT staffers as it shifted work overseas.

One bill prohibits a state-regulated utility from outsourcing any work associated with the "design, engineering and operation" of nuclear, electrical and gas infrastructure, "unless it first obtains the approval" of the state utility regulator.

Assembly Bill 853 calls the protection of energy systems, as well as ratepayer information, of "paramount state interest." It was approved by a 50-to-25 vote, with five members not voting, and now awaits state Senate action.

This bill may be one of the more significant legislative actions against offshore outsourcing in the U.S., and may inspire lawmakers in other states. Connecticut recently saw the layoff of utility workers, but lawmakers -- despite complaining about it -- took no legislative action to stop it.

A related measure, approved Monday by the State Assembly, is a resolution asking the U.S. Department of Labor and Congress "to investigate the alleged misuse of the H-1B program." That measure (Assembly Joint Resolution 12) passed 49 to 20, with 11 not voting. It also awaits Senate action.

SCE cut about 500 IT workers over the last year after hiring two India-based IT services firms. Some of the laid-off workers said that they had to train their temporary visa holding replacements as a condition of severance.

Since then, at least 11 U.S. Senators have asked for an investigation into H-1B visa's use in offshoring outsourcing.

The push for legislation in California is coming, in part, from SCE's union, the International Brotherhood of Electrical Workers, Local 47. The union doesn't represent IT workers, but believes its members are directly affected by the IT work.

Patrick Lavin, the business manager of the IBEW local, said that the state legislation is needed to get SCE to change its business practices. "The way Edison is, they don't do anything or pay attention to anything unless somebody has some authority over them," said Lavin, in an interview.

The state's public utility commission, which approves rates, has authority over utilities. If lawmaker make it a state law that regulated utilities "cannot outsource to India jobs, well, then that's going to be the law," said Lavin.

Asked for comment, SCE provided a letter it sent to California lawmakers detailing its opposition to the bill, and broadly said it "impacts hundreds of California businesses that are currently on contract with utilities and jeopardizes supplier diversity."Specifically, SCE said that the bill requires a utility to go through a public hearing with state regulators before it can employ a contract worker for work associated with design, engineering and operations. That, it argued, could delay work from several months to two years and bring some utility projects to a stand-still.

 

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